Page 17 - TEXtalks International October/November 2022

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Cotton prices become volatile
Cotton prices become volatile

like never before in histor
y
like never before in history

The textile sector has rarely seen such volatility in
The textile sector has rarely seen such volatility in Last week, the US Department of Agriculture
Last week, the US Department of Agriculture
. The cotton prices
lowered its global cotton output estimates to 1.6
cotton rates in history as this year
cotton rates in history as this year. The cotton prices lowered its global cotton output estimates to 1.6
peaked globally at $1.22 per kg on August 29, 2022, million bales. The cotton consumption is forecast at
million bales. The cotton consumption is forecast at
peaked globally at $1.22 per kg on August 29, 2022,
and came down to 85 US cents three months later
and came down to 85 US cents three months later 115 million bales, mainly due to a decline in mill use
115 million bales, mainly due to a decline in mill use
on November 18, 2022. in Pakistan and Bangladesh. On August 29, the
akistan and Bangladesh. On August 29, the
in P
on November 18, 2022.
cotton rate was $1.22 per kg; on November 18, it
cotton rate was $1.22 per kg; on November 18, it
The cotton rates in P
The cotton rates in Pakistan crossed Rs24000 per was 85 US cents. The crop estimates in India have
was 85 US cents. The crop estimates in India have
akistan crossed Rs24000 per
40 kg in August '22 and reached 18500 in
40 kg in August '22 and reached 18500 in been revised upwards to 34.2 million bales, though
been revised upwards to 34.2 million bales, though
November . This fluctuation in cotton rates locally still lower than last year's harvest of over 36 million
November. This fluctuation in cotton rates locally
still lower than last year's harvest of over 36 million
and globally has upset the economics of spinning bales. The abnormal price fluctuations in cotton
and globally has upset the economics of spinning
bales. The abnormal price fluctuations in cotton
mills. Those stocked or imported cotton at peak prices have placed the spinners' world in a
mills. Those stocked or imported cotton at peak
prices have placed the spinners' world in a
rates cannot recover their cost when the mills buying tight position.
rates cannot recover their cost when the mills buying
tight position.
cotton at lower rates sell at lower prices. These mills
cotton at lower rates sell at lower prices. These mills
could not afford to buy cotton at high rates and had The cotton prices increased earlier on reports of
The cotton prices increased earlier on reports of
could not afford to buy cotton at high rates and had
lower production in Pakistan and India, but the
to stop or slow down production temporarily
to stop or slow down production temporarily. lower production in P akistan and India, but the
.
expected shortage was overcompensated by
expected shortage was overcompensated by
Pakistan's textile industry uses cotton as its primary
P akistan's textile industry uses cotton as its primary higher -than-expected production in Brazil, Australia,
higher-than-expected production in Brazil, Australia,
raw material. Over 70 percent of the textile products and other countries. The production in the United
and other countries. The production in the United
raw material. Over 70 percent of the textile products
in Pakistan are produced from cotton. Unfortunately,
in P akistan are produced from cotton. Unfortunately , States even increased after initial reports of lower
States even increased after initial reports of lower
cotton production in P akistan suffered badly from cotton output. The China factor also played an
cotton production in Pakistan suffered badly from
cotton output. The China factor also played an
important role in the decline in prices. The Chinese
the floods this year . According to the latest data important role in the decline in prices. The Chinese
the floods this year. According to the latest data
released by the P akistan Cotton Ginners had stocked enough cotton to stop its cotton
released by the Pakistan Cotton Ginners
had stocked enough cotton to stop its cotton
Association, cotton arrivals declined by 41 percent.
Association, cotton arrivals declined by 41 percent. purchases from the rest of the world, and they may
purchases from the rest of the world, and they may
step in now that the prices have sobered.
The association attributed the decline to flash floods
The association attributed the decline to flash floods step in now that the prices have sobered.
that particularly impacted agricultural farms in Sindh
that particularly impacted agricultural farms in Sindh
, it would divert
and Balochistan. These figures are up to the
and Balochistan. These figures are up to the However, if the prices remained lower, it would divert
, if the prices remained lower
However
cotton farmers worldwide to other crops in 2023-24.
beginning of November. The farmers usually sow
beginning of November . The farmers usually sow cotton farmers worldwide to other crops in 2023-24.
, pesticides, and seeds
The input costs like fertilizer
wheat on their cotton farms in November. However, The input costs like fertilizer, pesticides, and seeds
wheat on their cotton farms in November
,
. However
have also increased in the last year with high energy
because of the shortage in the market and better
because of the shortage in the market and better have also increased in the last year with high energy
prices, the farmers are waiting for the next flowering costs. Selling cotton below $1 per kg would not be
costs. Selling cotton below $1 per kg would not be
prices, the farmers are waiting for the next flowering
that could add to cotton production.
that could add to cotton production. possible for them.
possible for them.
October/November 2022
October/November 2022